Moscow– 11 December 2011

Moscow – 11 December 2012 1

Moscow– 11 December 2011

Giuliano Bond

Council Member of Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili

International Financial Reporting Standards: a Regional Perspective


The Structure of the IFRS Foundation

Source: IFRS Foundation, Who we are and what we do, www. ifrs.org


How IFRS Are Published



European Regulation n. 1606/2002

“In order to contribute to a better functioning of the internal market, publicly traded companies must be required to apply a single set of high quality international accounting standards for the preparation of their consolidated financial statements.”

Member States HAVE TO ADOPTED THIS REGULATION for each financial year starting on or after 1 January 2005.

International Financial Reporting Standards (IFRSs) are developed by the International Accounting Standards Board (IASB), whose purpose is to develop a single set of global accounting standards.


The Endorsement of IFRS

IASB

EFRAG

ARC

European Parliament

European Gazette

Translations Enforcement

SARG


Adoption of IAS/IFRS Starting from 1 January 2005 (Legislative Decree 38/2005)

Listed companies and issuers of financial instruments widely

distributed among the public

(art.116 of Legislative decree 58/98)

Banks and financial institutions supervised

by Bank of Italy

Insurance companies (listed and not listed)

Consolidated companies by entities

obliged to apply IAS/IFRS for

consolidated F/S.Companies that draw up consolidated F/S

and their consolidated companies.

Not listed companies that do not draw up

consolidated F/S and companies that are

defined as small companies /ex art. 2435.bis civil code)

2005 2006 2005 2006 2005 2006 2005 2006

Consolidated financial

statement: compulsory.

Separate financial

statement: optional.

Consolidated financial


Separate financial


Consolidated F/S:

compulsory. Separate F/S:

according national law.

Consolidated F/S:

compulsory. Individual

F/S: compulsory if listed and not

obliged to draw up

consolidated financial

statement

Consolidated and separate F/S: optional.

Consolidated and separate F/S: according

national law.


IFRS

• As of 1 January 2012:

- Framework;

- 41 Standards (13 IFRS and 28 IAS);

- 25 Interpretations (17 IFRIC and 8 SIC)

• IAS/IFRS, as endorsed in European law, represent a juridical source of law.

• IAS/IFRS represent a benchmark of accounting practice


Adoption of IFRS in the world


Adoption of IAS/IFRS



Adoption of IAS/IFRS



Which Role for National Regulator? The European Commission Perspective

“Additional disclosure may still be required by e.g. supervisory Authorities or securities regulators of matters which: -are to be given outside the annual (or consolidated) accounts to which the IAS Regulation applies – say in the annual report or in a separate schedule annexed to the accounts; or -are to be given within the notes to the annual (or consolidated) accounts to which the IAS Regulation applies when the subject matter is perceived as highly relevant to those general purpose accounts (for example, certain corporate governance related disclosures such as management remuneration by individual) but falls outside the scope of IASs as it is not necessary for the presentation of a true and fair view in accordance with IASs”. (Source: Comments Concerning Certain Articles of the Regulation (EC) No 1606/2002 of the European Parliament and of the Council)


Which Role for National Regulators? The Italian Legislation Perspective

1. The powers of Bank of Italy (as specified in articles n. 5 and 45 of Legislative Decree n. 87/1992) are exercised for the banks and financial institutions, obliged to apply IAS/IFRS, under the supervision of Bank of Italy according and in respect of the International Accounting Standards;

2. The powers of ISVAP (public Authority for insurance companies) are exercised for the insurance companies that apply IAS/IFRS for financial statements (consolidated or individual) according and in respect of the International Accounting Standards;

3. CONSOB (public Authority for responsible for regulating the Italian securities market) establishes the format of financial statements for listed companies and issuers of financial instruments widely distributed among the public (Legislative Decree 38/2005. art. 9).


Which Role for National Standard Setter: Organismo Italiano della Contabilità and

CNDCECThe Organismo Italiano di Contabilità (OIC ) was formed in 2001 as a registered Foundation, in response to the need perceived by the main public-sector and private-sector parties to establish an Accounting National Standard Setter

The OIC Founders include Institues largely representing the parties interested in the accounting matters

Consiglio Nazionale Dottori Commercialisti ed Esperti Contabili, professional body, which is the competent authority and the only professional body of accountants in Italy, is an OIC’s Founder and it was the body that published National Accounting Standards up to 2001


Which role for National Standard Setter: Organismo Italiano della Contabilità and

CNDCECIn carrying out its activities, OIC participates in the activities of development of IAS/IFRS, providing technical support to EFRAG and coordinating its work with the activities of other European accounting standard setters

CNDCEC partecipates to some commissions within OIC, publishes documents regarding accounting issues and replies to Exposure draft and Discussion Paper of IASB, IFAC and FEE


The Accounting Standards Advisory Forum

In November 2012, the IFRS Foundation has published a document that has the objective to formalise the relations between IASB and NSS (National Standard Setter) regional bodies to involve the NSSs in the standard setting process

The IFRS Foundation and IASB should encourage the maintenance of a network of NSSs involved with accounting standard-setting as an integral part of the global standard-setting process. In addition NSSs and regional bodies should continue to undertake research, provide guidance on the IASB’s priorities, encourage stakeholder input for activities of development of international accounting standards, providing technical support


The European Union reform of the Accounting Directives

• The EU is expected to vote for a “new” accounting regime in the 2013

• There are some proposals converging towards IFRS’ requirements, such as:– EC proposal to require or permit IAS/IFRS for

financial instruments (even if there amendments against it)

– materiality (even if there amendments on it)– elimination of extraordinary items

• There is a «political» opposition to IFRS for SMEs, even if Member States could require/permit at today a «quasi-full» application


IASB Agenda

2012Q4 2013Q1 2013Q2 2013 Q3 IFRS 9: Financial Instruments (replacement of IAS 39)

Classification and Measurement (limited amendments)

Target ED

Impairment Target ED Hedge Accounting [Review Draft posted until December 2012]

Target IFRS

Accounting for macro hedging Target DP Leases Target ED Revenue Recognition Redeliberations Target IFRS Insurance Contracts Target ED

Memorandum of Understanding projects 2012:Q4 2013Q1 2013Q2 2013Q3 MoU Joint


Issues

• Uniform application or regional IFRSs

• The role of regulators

• The role of National Standard Setters

• The role of ACCOUNTANTS


Ciao

[email protected]

Documents

Moscow– 11 December 2011